Palm Oil Production in Malaysia Faces Potential Growth as Indonesia Grapples with Heat-Related Challenges

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Doc. Sawit Fest 2021 / RIZKY HASANUD DZIKRI

PALMOILMAGAZINE, KUALA KUMPUR – “Palm oil production in Malaysia may reach its peak in September and gradually decline from October onwards, coinciding with the onset of the rainy season in the country.

According to the PalmPulse report published by the Malaysian Palm Oil Council (MPOC), concerns about the potential impact of El Nino, which could have caused drought conditions for palm oil trees, are diminishing. The report predicts that heavy rainfall and thunderstorms are expected during the monsoon transition phase from September to November.”

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In the contrary, palm oil plantation cultivation in Indonesia particularly in Kalimantan and Sumatra are hardly no raindrops since July 2023. According to ASEAN Specialized Meteorological Centre (ASMC)) data that was displayed and reinforced by satellite monitoring by National Oceanic and Atmospheric Administration (NOAA), certain regions in Malaysia peninsula, Sabah, and Serawak got enough rain in September. While Kalimantan and Sumatra got 4.810 total hot spots in the same month. These were indicators that the regions were lack of rain.

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This unlucky weather system could potentially make palm oil plantations in Indonesia drier which eventually decreases palm oil production in the second quarter of 2024. “The condition would deliver important support to palm oil production price,” PalmPulse noted.

Meanwhile, India and China as the two biggest palm oil importers have had increasing vegetable oil stocks to the highest level that reached 1,46 million tons on 1 September and 2,1 million tons on 22 September for each.

Diwali celebration in India in November, and Golden Week of China by the early of October depicted the highest vegetable oil stocks in the two countries. As the result, palm oil exports from Malaysia to the two countries would get decreased after the two celebrations. Palm oil stocks in Malaysia remain more than 2 million tons by the late of 2023 and it would have something to do with palm oil price to get more expensive. (T2)

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